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TSB axes current account interest: Where now for savers?

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From tomorrow, TSB customers with a Classic Plus current account will no longer earn any interest on their money.

The TSB Classic Plus current account currently offers 1.5% AER on balances up to £1,500 as long as customers pay in £500 a month.

From tomorrow (2 December), it will axe credit interest on the account, after previously slashing the rate from 3% in May 2020.

Back in 2018, it offered 5% in-credit interest to customers as a gesture of goodwill in the wake of its IT meltdown.

The TSB Classic Plus account was closed to new customers on 23 September 2020.

Where now for fee-free in-credit interest?

There have been interest rate cuts across the board and current accounts have also wound back their offerings.

The Virgin Money current account offers 2.02% AER on the first £1,000 of your account balance, plus its linked saver offers 0.5%. For new customers switching to it, they can also bag £180 worth of wine.

Alternatively, the Nationwide FlexDirect current account pays 2% on balances up to £1,500 for the first 12 months (0.25% after).

The Bank of Scotland – Classic with Vantage and Platinum with Vantage – and Lloyds Bank Club Lloyds account pay 0.60% AER on balances up to £3,999.99 and 1.5% AER on sums between £4,000 and £5,000.

Before switching account, check you can meet the eligibility criteria such as meeting the direct debit requirements and minimum monthly pay in amounts.

You can also see reward current accounts which charge a monthly fee for more information.

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